SOLAR TODAY - November/December 2010

solar incentive programs

efficiency of the SWH system and, therefore, greater savings to the building owner.

toward a self-sustaining
solar thermal market

The design elements of the CSI-Thermal Program developed by the CPUC are aimed at overcoming the identified barriers in order to significantly increase the rate of SWH adoption in all market segments in California between now and 2018, when the program is set to end (unless the money runs out first). The program has goals of saving 585 Mtherms and 275.5 million kilowatt-hours, which equates to the installation of 300,000 single-family SWH systems, or to 3. 2 million metric tonnes of CO2. SDG&E territory is considered to be about 10 percent of the state, which means its energy-saving goals under the new CSI-Thermal Program would be equivalent to 30,000 single-family installations. When compared to the SWHPP, which saw 319 single-family installations in a three-year timeframe, this is certainly an aggressive goal.

California’s Assembly Bill 32 also has an aggressive goal: to reduce greenhouse gas emissions by 169 million metric tonnes of carbon dioxide equivalent, down to the 1990 level by 2020. Energy efficiency, which includes SWH, is identified as being an important piece for reaching this goal. At the current rate of adoption, which is estimated at being roughly 1,000 SWH systems annually across the state, California may fall short of these goals. This explains the importance of and need for a transformation of the solar thermal market.

Through the use of market-facilitation funds, the CSI-Thermal program addresses three of the identified barriers: consumer awareness, permitting and workforce development. Ten percent of the overall $350 million program budget is earmarked specifically for market-facilitation activities that will educate each of these market segments, such as consumer outreach workshops, installer trainings, collaboration and training with permitting officials and media campaigns.

The program addresses the cost barrier by providing incentives that are initially about 20 percent of the average SWH installation cost. Incentives are not based on the project cost, but on the expected first-year energy displacement of the SWH system. Basing incentives on performance ought to encourage high-performing, low-cost systems in the market. Sixty percent of

more Information on

Solar Water Heating

Learn about solar water-heating collectors and systems at the Solar Rating and Certification Corp. web site: solar-rating.org.

The National Renewable Energy Lab is the nation’s primary laboratory for renewable energy and energy-efficiency research and development. Check their web site to find out how they are advancing our nation’s energy goals: nrel.gov.

Incorporating quality-control measures into program requirements is an essential part of achieving a self-sustaining market. Establishing equipment standards, such as a certification from the Solar Rating and Certification Corp. — an independent certifying entity of SWH equipment and systems — enables standardized comparisons of all SWH systems. Ensuring that systems are properly sized and installed will optimize system performance and life cycle cost-effectiveness. This can be done through enforcing maximum sizing guidelines and on-site field inspections. Inspections help prevent inadequate SWH installations and also provide contractors new to the market with a learning tool to improve future installations.

The Solar Energy Industries Association and the American Solar Energy Society are working to remove market barriers, educate the public and make solar mainstream: seia.org and ases.org.

the $280 million incentive budget is set aside for multifamily and commercial projects, while the remaining 40 percent is allocated for single-family residential projects. Additionally, incentives are highest at the beginning of the program to jumpstart the market. The design is intended to increase demand at the onset of the program, boosting industry competition and driving down costs. Incentives will decrease over time, in parallel with decreasing costs, resulting in a self-sustaining SWH market by 2018. This is the CSI-Thermal vision for market transformation.

Finally, a significant lesson learned from the SWHPP is the importance of education and outreach. Once a solid rebate program has been developed, it is time to get the word out to consumers to take advantage of the rebates while they last. It is also important to provide consumers with the knowledge and tools needed to make an informed decision as to whether SWH is right for them. Workshops to educate consumers about solar thermal technology, its energy-saving potential, market trends and installation costs, the rebate program and its quality-control measures and how to select a contractor will increase awareness and consumer confidence in SWH. In turn, this will foster participation in the rebate program.

Lessons Learned

California has gleaned many lessons through past experience with SWH rebate programs. The three most significant elements to a successful rebate program are a collaborative development process with industry stakeholders, a focus on quality and a strong education and outreach campaign. Regulators and policymakers are often far removed from the daily operations and challenges faced by industry professionals. When creating rebate program requirements, it is essential to include input from those who understand the industry best. By including equipment manufacturers and installers in the process, regulators are better able to make decisions that will foster participation in the rebate program.

With market transformation comes a variety of societal benefits. SWH systems displace natural gas or electricity, reducing demand on the transmission and distribution systems and potentially reducing the need for expanded lines. SWH systems reduce the use of conventional fuels that emit air pollutants, resulting in lower health costs. Growth in the SWH industry also encourages creation of high-paying jobs in the manufacturing and installation/maintenance sectors. Finally, in reaching its goal of saving 585 Mtherms and 275.5 million kilowatt-hours, the CSI-Thermal Program will have saved enough CO2 to equal the annual carbon uptake of 117.5 million trees, or the equivalent of removing 131,645 American consumers from the planet for a year. California is hoping that other states will follow its lead and improve communities through the adoption of solar thermal technologies.